1. Introduction
    1. Political and administrative structure
    2. Legal environment
  2. Common forms of business structures for foreign investors
    1. Main types of structure
    2. Registration, liquidation and reorganisation of business structures
    3. Shareholders’ and participants’ agreements
    4. Strategic industries
  3. Anti-monopoly issues
    1. General legal and regulatory framework
    2. Scope of application of the Competition Law
    3. Anti-competitive practices and restriction of competition
    4. Liability
  4. Tax system
    1. General approach
    2. Corporate taxation
    3. Incentives
    4. Special tax regimes
    5. Taxation of individuals
    6. Double taxation treaties
  5. Customs regulations
    1. General approach
    2. Trade between EEU and non-EEU countries
    3. Mutual trade between the EEU members
  6. Currency control
    1. Foreign currency transactions
    2. Consequences of breach/Penalties
  7. Lending in Russia
    1. Lending documents and governing law
    2. Jurisdiction
    3. International finance transactions and repatriation requirements
    4. Security interests
    5. Recognition of security trusts
    6. Syndicated loans
    7. Enforcement
    8. Suretyships and guarantees
    9. Bankruptcy considerations
    10. Other lending related issues
  8. Employment and migration
    1. Formalising the employment relationship
    2. Managing employment relationships
    3. Terminating an employment agreement
    4. Specifics of employing foreign nationals
  9. Personal data protection
    1. General approach
    2. Scope of the Data Protection Law
    3. Liability
    4. Right to be forgotten
  10. Intellectual property
    1. General approach
    2. Contractual aspects of intellectual property rights
    3. Rights over the results of intellectual activity
    4. Company names, trade names, trademarks and appellations of origin
    5. Intellectual property rights infringements
    6. IP Court
  11. Advertising issues
    1. General approach
    2. Scope of application of the Advertising Law
    3. Violations of the Advertising Law
    4. Liability
  12. Anti-corruption and compliance
    1. General approach
    2. Legal framework
    3. Compliance requirements for companies
    4. Concept of corruption in Russian law
    5. Possible targets of bribery
    6. Liability and penalties for corruption
    7. Example of sector-specific anti-corruption measures
  13. Real estate and construction
    1. Rights to real estate
    2. Real estate transactions
    3. Resolution of real estate disputes
    4. Planning and construction issues
  14. Corporate bankruptcy
    1. Insolvency criteria
    2. Stages of bankruptcy proceedings
  15. Import substitution and production localisation in Russia
    1. Measures affecting goods importation and current import substitution legislation
    2. Localisation incentives
    3. Sector-specific impact of import restrictions and localisation requirements
  16. Banking sector
    1. Legislative and regulatory framework
    2. Licensing and operations
    3. Deposit insurance
    4. The anti-money laundering law
    5. Bank secrecy
    6. FATCA and CRS
  17. Environment, energy efficiency and renewables
    1. Environment
    2. Energy efficiency
    3. Renewables
  18. Infrastructure and public private partnerships
    1. General approach
    2. Key PPP legislation
    3. Russian PPP environment
    4. Financing
    5. Legal issues
    6. Prospects for infrastructure projects
  19. Oil & gas
    1. Legislative framework
    2. Ownership and licensing
    3. Restrictions on foreign investors
    4. Licences
    5. PSAs

Key contacts

Jean-Francois Marquaire
Jean-François Marquaire
Managing Partner
Head of Corporate | Head of Infrastructure & Projects
T +7 495 786 40 00

Russian PPP environment

Governmental commitments

The Russian authorities have adopted several programmes aimed at modernising infrastructure, including roads, railways, airports, power generation plants, as well as healthcare and social infrastructure.

The Government provides support to private investors in order to attract foreign investment. For instance, it co-finances and/or guarantees PPP projects. It also provides tax credits and other benefits prescribed for special economic zones (please see the relevant section of the Tax system chapter) .


The Ministry of Transport is the state body responsible for the development and investment policy in all areas of transport. Each means of transport (roads, airports, railways, etc.) is under its supervision and is managed by a specialised entity, which, in turn, reports to the Ministry of Transport.

Some PPP transport projects which will be implemented within the coming years in Russia include:

  • the transport project Europe-West China;
  • sections 5-3 and 4 of the TsKAD;
  • a bridge in Novosibirsk;
  • a private parking system in Saint Petersburg;
  • a bypass (“obkhod”) of Khabarovsk;
  • a private tram in Saint Petersburg;
  • a high-speed tram in Samara;
  • a railway link from Saint Petersburg’s centre to Pulkovo airport; and
  • the further modernisation of Moscow’s airports (first of all Sheremetyevo, in respect of which a concession agreement has been signed, and then Domodedovo and Vnukovo), as well as of the airports of Noviy Urengoy, Vladivostok, Irkutsk, Omsk and Oryol (Yuzhny).

The state company Russian Highways is responsible for, amongst others, PPP projects in relation to federal roads. Under its activity programme for 2010-2024, as approved1 by the Government, Russian Highways will be allocated RUB 1.42tn (EUR 19.9bn) to (re)construct highways, develop new international routes and create a chain of multifunctional road service zones through PPP projects. Most PPP projects are planned to be implemented under long-term investment as well as concession agreements and operation & maintenance contracts.


JSC Russian Railways (“RZD”) operates a monopoly in the Russian railway sector and is currently implementing a number of investment projects, such as the reconstruction of the Baikal-Amur and Trans-Siberian railway links and the Moscow-Kazan High-Speed Rail project (VSM-2).

The design of the Moscow-Kazan High-Speed Rail project was completed in 2017 as a procurement for RZD and was financed by the state. Concession agreements for the construction and operation of some sections of the Moscow-Kazan rail link will be entered into, which alongside state financing will require a significant amount of private investment. Construction was expected to begin in 2018. According to public estimates, the total value of the project will exceed RUB 1tn (EUR 13.3bn). That said, it is now highly likely that this project will be cancelled due to unfavourable traffic and projected income analysis. Instead, a toll automobile road will be built to Kazan, and the VSM-1 high-speed rail project between Moscow and Saint Petersburg will be revived.

The VSM-2 project was supposed to become part of an even more ambitious project, the “Silk Road Initiative”, aimed at creating a high-speed rail link between Europe and China through Russia. Even if VSM-2 is cancelled, the Silk Road Initiative may still be implemented in the future.

On the positive side, two major railway projects were signed in 2019 involving:

  • a concession agreement regarding a freight railway line to the Togliatti special economic zone with a total amount of investments of approx. RUB 0.9bn (EUR 12.8m); and
  • a concession agreement regarding a freight railway line to the Kaluga special economic zone with a total amount of investments of approx. RUB 655m (EUR 9.3m).

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Communal utilities

Utilities have long been a successful and receptive area for private investment. They are also thought to offer a great potential for foreign investment. As an inheritance from the Soviet Union, Russia received a large number of publicly-owned housing and utility facilities, most of which are in poor condition, requiring urgent repair or modernisation.

The Government – and especially the Federal Ministry of Construction, Housing and Utilities which is implementing a programme for the development of communal utilities – is actively attracting private investment into the communal utilities sector. The Government is ensuring long-term commitments of the state towards investors and tariffs to cover both capital and operational expenses, as well as guaranteed profit. In some sectors where tariffs cannot cover both capital and operational expenses (e.g. waste management), additional state financing is available.

It is expected that a new programme for the development of communal utilities (to be completed by 2035) will be adopted in 2020 aiming to provide individuals with high-standard and affordable housing and communal utilities.

Waste management

Waste management is likely to be a pressing issue in the coming years, since a significant number of existing waste disposal facilities are waste dumps and quite a few of them are reaching maximum capacity. Some of these dumps are poorly managed, which sometimes results in toxic fumes.

That said, there is a need for private investment in waste management, including investment in modern means of disposal and recycling.

The Concession Law was amended in 2015 to include industrial waste facilities as potential objects of concession agreements (previously only facilities operating with household waste could be the subject matter of concessions).

There is currently a debate as to whether concessions or PPPs would only be effective if the private partner also becomes a regional waste management operator2. However, this cannot be legally guaranteed because regional waste management operators are selected via separate tenders.

At the same time, it is possible to implement some quasi-PPP projects based on contracts with regional operators without an additional concession or PPP agreement. For example, the subsidiaries of the Rostekhnologii state corporation won tenders to become the regional operator for significant amounts of waste treatment in the Moscow Region and Tatarstan.

A new state corporation operating in waste management, the Russian Ecological Operator, was incorporated in 2019. It is responsible for coordinating efforts on waste treatment at a federal level, re-cultivating existing waste dumps. It also accumulates know-how and participates in investment projects related to waste treatment. This state corporation is expected to play a role similar to that of SC Russian Highways in the management of automobile roads.

Power (heating and electricity sector)

Tariffs in the heating sector in Russia are traditionally relatively high compared to those in other sectors, while the equipment used is old and inefficient. This makes this sector open for private investors, including foreign investors and producers of modern equipment. As a result, there are currently many regional projects of different scale (from one to several districts) being at various stages of implementation.

Many of the existing plants are combined heating and electricity producing plants, which generates an additional source of income. Projects using renewable energy sources, such as biogas, biomass and peat, can further benefit from green tariffs granted by the state as an incentive for renewable energy, which can be three to five times higher than the standard market price for electricity.

By-product electricity generated by waste treatment plants to be constructed in Russia is also considered as renewable energy.

Water and wastewater

Under the law on water supply and wastewater treatment3, infrastructure in this field must remain within the public property domain. That means that the new PPP Law is not applicable to this type of facility and instruments available for private investment into this sector are limited to concession agreements, long-term lease agreements and other quasi-PPP models where ownership is not transferred to the investor.

Amendments to the Concession Law which have been effective since 1 January 2017 actually increased the number of concession projects in water and wastewater infrastructure.


In 2015, a law on capital renovation of housing4 introduced a new fee for capital renovation of apartment buildings which must be paid by all urban population. The fees are accumulated either by state-controlled regional funds responsible for the renovation of housing in specific regions, or by municipalities which contract directly with companies for renovation works with respect to particular housing objects. Such funds will in the future become the resource for financing capital repairs of apartment buildings.

Apartment buildings are currently not mentioned among possible objects of concession or PPP projects. However, the Russian Government may be developing plans for attracting financing for capital repairs. Given the existing trends, this mechanism might be of a PPP or of a quasi-PPP nature.

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Healthcare sector

PPP has also begun to develop actively in the healthcare sector: hospitals and innovation centres are being built in the regions.

In 2019, numerous agreements were concluded for construction in the healthcare sector. Moreover, in the Novosibirsk Region, a PPP project for the creation of city clinics was completed.

Investment in healthcare infrastructure is also actively supported by the Government through long-term commitments to buy the services of private operators of infrastructure facilities through state social security funds, as well as through the implementation of life-cycle agreements (please see the Alternative schemes or quasi-PPP section).

There are already a number of successful healthcare infrastructure projects in Russia, some of which are implemented by foreign investors. More projects are about to take off in the near future in Moscow, Saint Petersburg, the Leningrad Region, Vologda, Udmurtia, Ulyanovsk, Novosibirsk, Samara and other major regions of Russia, including a number of nuclear medicine projects in major Russian cities such as Moscow, Rostov, Tomsk, etc.

One of the new trends is creating medical clusters, such as the Medical Cluster in Skolkovo and the International Moscow Medical Cluster, which will provide different benefits for their respective residents.

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Social infrastructure

PPP projects in social infrastructure are primarily initiated in the regions, such as the construction of retirement homes in the Moscow Region and in Buryatia, several sport facilities in the Nizhniy Novgorod Region, a college for gifted children in Omsk, education facilities in the Pushkinsky District of Saint Petersburg and the construction of 25 kindergartens in Tomsk. Five concession agreements for the construction of schools in the Khanty-Mansiysk Region were concluded in 2019.

The main obstacles for investors in this field are the return on investment and lack of available guarantees. Given that the payment profile of consumers is relatively low, the cash-flow of social projects is usually based on the availability of payments made by the relevant state authorities (grantors).

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[1] Order No. 2146-r of the Government of the Russian Federation dated 31 December 2009 (as amended).  Back ↑

[2] This means that the private partner basically becomes the default waste management operator for the region, and it provides waste management services to all customers of the region. Thus, the status of the regional operator guarantees demand and cash flow. Back ↑

[3] Federal Law No. 416-FZ dated 7 December 2011. Back ↑

[4] Federal Law No. 271-FZ dated 25 December 2012. Back ↑

Key contacts

Jean-Francois Marquaire
Jean-François Marquaire
Managing Partner
Head of Corporate | Head of Infrastructure & Projects
T +7 495 786 40 00